In a move that doesn't surprise me, EarthLink and Google have combined their proposal to build a network in San Francisco: Both companies have openly spoken for months about how they were working together to understand how viable models for a variety of metro-scale networks could operate profitably for the ISP. Google has said rather consistently as well that they aren't interested in running Wi-Fi networks, but rather need some testbeds to try out ideas--hence their SF and Mountain View interests.

Don Berryman of EarthLink stated in a brief release (also found on the company's Earthling blog), "We will be able to offer services to different customers on the network that fit with their own individual needs and wants." Based on my research and interviews, I suspect this means that Google can offer ad-sponsored free access and perform the tests on efficacy that they want. They can also introduce tests of new services or variations on services, such as their instant messaging and virtual private network software. EarthLink can charge for higher-speed access and provide business-grade service using their Motorola Canopy backbone. (The free/fee tiered basis is now being reported at GigaOm.)

This is another nice win for Tropos and Canopy, by the way, as EarthLink has committed to using gear from those two firms for at least the first five cities that they build out. Other bidders now face a higher bar given the integration of the two firms' proposals.

My friend and colleague Om Malik has been beating a drum for months that Google might build Wi-Fi networks from coast to coast. I have disputed this not based on evidence--Om uncovered fiber optic line leases and other deals--but on margins. Google has a very high-margin advertising business, while ISP service involves ugly amounts of physical infrastructure investment and relatively low margins that require huge volumes to achieve good returns.

Now the EarthLink-Google bid linkage in San Francisco is fascinating as Google originally was to build their network using wireless infrastructure builder WFI. The status of that wasn't mentioned in the brief statement I received from EarthLink, of course.

Update: The San Jose Mercury reports bids have also been received from MetroFi, Communication Bridge Global, NextWLAN, Razortooth Communications and SF Metro Connect (SeaKay, Cisco Systems and IBM). Cisco has new mesh equipment and IBM has a service operation that handles installations of networks.